The battle for the future of Australia’s second largest dealer group, Professional Investment Services (PIS), has been won by Aviva, with the financial services company proposing to take a 20 per cent stake.
Aviva has held a small stake in PIS for many years and the Queensland dealer group is a major user of Navigator, with about $2 billion of funds in the Aviva master trust platform.
Under the deal – subject to due diligence – Aviva will increase its stake to 26 per cent.
The deal, however, is still subject to approval by Aviva’s board in the UK, along with agreement on the necessary documentation. It will see Aviva acquiring 20 per cent of the shares in Professional Investment Holdings, the parent of PIS, from existing company shareholders.
An Aviva spokesman said the move was to enable PIS to maintain its independence; the stake is not a takeover.
“Aviva will not seek control of PIS and the move is seen as continuing a long-term partnership,” he said.
No figures have been quoted for the acquisition and the Aviva spokesman declined to comment.
Three other players – Macquarie, an ING/ANZ joint venture and the Commonwealth bank – had also been pursuing the dealer group.
Aviva was keen to secure a deal as a defensive move to protect its funds under administration in Navigator.
PIS chief executive officer Robbie Bennetts said the group had been evaluating a trade sale or a listing for some time.
“Today’s decision creates an opportunity for a combination of both, with a strong partner in Aviva working with us,” he said in a statement today.
“Aviva has been a strong business partner from our birth and understands our culture and our business model well.
“We see the extension of this relationship bringing both organisations closer together to develop new product offerings and enhancing the value propositions of both.”
Bennetts said the dealer group plans to grow the business by 40 per cent in 2005 and will be presenting its strategy to advisers and accountants, which will include new ideas for enhancing their businesses.
